AMCX

Strategic Content and IP Highlights

• Announced a 5-year co-exclusive global licensing agreement with Netflix for all 7 series and 371 episodes of The Walking Dead universe, with $500 million in total contracted fees. The deal creates a global streaming home for the franchise while bringing the original series to AMC Plus for the first time, and rights revert to AMC Global Media at the end of the license term.
• Darkwinds Season 4 immediately reached Netflix's U.S. Top 10 list upon launch; Anne Rice's Interview with the Vampire was renewed for Season 4 after delivering higher AMC Plus viewership than the prior season, and The Walking Dead: Dead City Season 3 launched to strong fan engagement at San Diego Comic-Con.
• Acorn TV's re-energization effort with new original programming has exceeded expectations, with breakout hits delivering double-digit viewership gains over prior seasons. Sequential improvement in subscriber retention and a double-digit increase in engagement was seen across all streaming services in Q2, even after implementing price increases.

Distribution and Affiliate Updates

• Hard bundled distribution arrangements across streaming and linear are growing, with 2.3 million activations of AMC Plus and All Reality across Charter and Philo; DirecTV recently added AMC Plus as a hard bundle in its entertainment package.
• Renewed long-term distribution agreements with four of the five major domestic MVPDs (Comcast, DirecTV, Dish, YouTube) in the last 12 months. The new YouTube agreement includes distribution of all 7 AMC streaming services and FAST channels, with future network launches planned for YouTube TV genre packages.

Studio and Operational Highlights

• Production on the NASCAR partnership drama Thunder Road, starring Dennis Quaid, will begin next month at AMC's Georgia studio facility. The AMC Studios team is actively developing third-party projects for external distributors, building on the success of the Apple TV+ hit Silo.
• TNA Wrestling's Thursday Night Impact hit an all-time ratings high on AMC linear, bringing new live younger-skewing viewers to the network. Primetime ratings grew quarter-over-quarter for most linear networks, led by a 21% gain at WeTV.
• Upfront advertising discussions are progressing well with strong client engagement; excluding the Q2 technical issue, domestic advertising trends improved and digital advertising grew in H1 2026. The company paid down all remaining Term Loan A and terminated its prior credit facility, improving its debt maturity profile with 75% of total debt not due until 2032.

• Full-year 2026 consolidated revenue guidance is updated to $2.4 billion to $2.45 billion, an upward revision that incorporates $200 million to $225 million in revenue from the The Walking Dead Netflix licensing agreement, partially offset by slower-than-expected first-half subscriber acquisition driven by geopolitical events and high-profile sports like the World Cup. Domestic subscription revenue is now expected to decline a modest 3% full-year vs. 2025, while domestic content licensing revenue is projected to reach $460 million to $485 million.
• Full-year adjusted operating income (AOI) guidance is raised to $410 million to $420 billion, reflecting higher expected revenue from the new licensing deal partially offset by incremental programming expenses related to the agreement.
• Full-year free cash flow guidance is increased to approximately $220 million, incorporating the expected $25 million in 2026 cash payments from the Netflix deal. The company remains on track to hit this target after generating $108 million in free cash flow in the first half of 2026.
• Management expects the rate of affiliate revenue decline to improve in the second half of 2026 as new agreements and contractual changes take effect, and projects AOI growth in H2 2026 after the Q2 low point.

Consolidated: Net revenue declined 9% YoY to $547 million; adjusted operating income (AOI) was $46 million, the expected low point for the year; free cash flow was $43 million. Domestic Operations: Revenue decreased 11% YoY to $470 million (85.9% of total consolidated revenue). Subscription revenue decreased 5% overall, with 6% growth in streaming revenue offsetting a 17% decline in affiliate revenue (in line with expectations). Excluding a one-time system integration issue, advertising revenue declined in the mid-single digits. Content licensing revenue was $56 million. Domestic AOI was $61 million. International Operations: Revenue increased 4% YoY to $79 million (14.4% of total consolidated revenue); excluding favorable foreign currency translation, revenue grew 2% YoY. Excluding FX, subscription revenue decreased 3% due to the wind-down of a Poland/Africa joint venture, while advertising revenue increased 11% YoY. International AOI was $14 million, with an 18% margin.

• Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from projected outcomes, as detailed in the company's SEC filings.
• Slower-than-expected subscriber acquisition in the first half of 2026 was driven by geopolitical uncertainty and outsized consumer attention diverted to high-profile global sports programming, creating a headwind to full-year subscription revenue.
• The timing of licensing revenue recognition and marketing investment for series premieres can create quarterly AOI volatility; the five-year staggered payment schedule for the Walking Dead deal also creates a timing mismatch between recognized revenue and cash receipts.
• The affiliate revenue market continues to face ongoing industry decline, even as the rate of decline is expected to improve in the second half of 2026.

Q: What was the competitive dynamic of the The Walking Dead licensing bidding process, why did you choose Netflix, and what are the additional headwinds driving the full-year guidance adjustment beyond geopolitical events and sports? / A: Multiple major media players participated in the bidding, with a range of structural options considered including a global single-partner deal vs. piecemeal rights sales. Netflix was selected because it was already an incumbent, experienced partner for the franchise, and the global co-exclusive structure was the best fit for AMC's strategic and financial goals. The 2026 FIFA World Cup was a notable consumer attention headwind in the first half, but management remains optimistic about stronger streaming and linear performance in the back half of the year after the Q2 low point.

Q: Why was this co-exclusive deal structure chosen, what impact do you expect it to have on AMC Plus engagement, and what are your plans for expanding sports and sports-adjacent content? / A: AMC spent years aligning global rights for the entire The Walking Dead franchise to secure the best possible economic outcome. Co-exclusivity brings the original series to AMC Plus for the first time, and management expects strong incremental engagement from the franchise's core fanbase that associates the IP closely with the AMC brand. TNA Wrestling has outperformed expectations, delivering new younger viewers to linear AMC and aligning well with the network's character/Story-driven brand identity. In the U.S., AMC will focus on sports-adjacent content (like its Rise sports docuseries franchise) rather than bidding for direct live game rights; the company already operates top live sports channels in multiple Central and Eastern European markets.

Q: How should investors think about AOI contribution from the Walking Dead deal across years, and how much of the 2026 guidance change comes from the deal versus underlying business changes? / A: Revenue recognition follows standard ASC 606 rules, requiring recognition at the present value of future contracted payments, leading to $200 million to $225 million of revenue recognized in both 2026 and 2027, out of $445 million total revenue over the agreement's life. Like all content licensing deals, the agreement has high AOI margins. The guidance update primarily adds the revenue from the new Walking Dead deal, with the only underlying downward adjustment reflecting slower first-half subscriber acquisition that leads to a projected 3% full-year domestic subscription revenue decline vs. 2025. Advertising guidance remains unchanged from prior outlooks.

Q: How is affiliate revenue trending amid recent large media industry transactions, and how will industry consolidation impact AMC's strategy? / A: Early signs point to stabilizing domestic cable subscriber trends, which would benefit the entire industry. AMC recently completed a smooth, disruption-free renewal with YouTube TV, demonstrating the value of its content to distributors; the company has now renewed deals with four of the top five major domestic MVPDs in the last 12 months with favorable terms. Industry consolidation can be a tailwind for AMC, as fewer large platforms need differentiated high-quality owned IP, and AMC is a leading independent supplier of premium programming. The company will maintain its existing strategy of building valuable owned franchises and distributing content across all platforms, while monitoring industry developments.